It was a year of disruption, 2009, especially in regard to our concept of currency. While money had previously been controlled, either by commodity or political authority, the advent of bitcoin initiated a wave of change.
Bitcoin is the world’s first digital, decentralised, peer-to-peer cryptocurrency and payment network. Bitcoin has revolutionised the payment industry by building a trustless system that doesn’t require a trusted third party to make payments worldwide. This trustless system is known as Blockchain. Bitcoin is the first application of Blockchain and this opens up the door to build numerous other applications on it.
Based on mathematics, the concept of bitcoins promised a free currency, however, the same has often been misused by the hackers and cyber-criminals to demand ransom. The fact has been made evident by the WannaCryRansomware that hit the commercial world like a storm. This makes matters more precarious, since in India, bitcoins are only gaining momentum as the latest, cash-free, frontier for payments and investments.
However, not all is lost! When it comes to safeguarding bitcoins against falling prey to cyber criminals, there is a lot that one can do. By becoming aware of the security alternatives and exercise the same, users today can continue to smoothly transact or invest in bitcoins.
To the same end, here’s discussing the easiest ways in which users can safeguard their bitcoins.
Opt for Cold wallet
Cold wallets are offline wallets which are stored in an offline vault and have no access to internet. Always use different wallet for various different type of transaction. It is advisable to split up your bitcoin holdings between numerous wallets.
Backup and encrypt your wallet
Always remember to backup and encrypt your wallet. If one of your backups is hidden and unencrypted, someone finding it would instantly know your private keys. This is essential if you are using web wallet and mobile wallet. Also backup and store your hardware wallets at multiple GEO locations. It is extremely important to ensure that your backup is available in 2 to 3 different places like a trusted friend’s home etc. Never store your wallet address and the encryption key in the same place.
Consider Hardware wallets
Hardware wallets are special type of bitcoin wallets which holds bitcoin in secure hardware devices. In these wallets, private keys are stored in protected part of microcontroller and also in encrypted form which cannot be translated into plaintext outside of device. These devices are also malware protected.